Baidu and how to choose the m&a project and valuation is ali


the original point PK: Internet giant baidu VS ali company mergers and acquisitions that something

author: the Oriental morning post reporter ZhuangChunHui from snowball

on August 8, clear division of the “2013 China equity investment and m&a convention”, in addition to baidu, general manager of enterprise investment at the soup and loose, TMT industry mergers and acquisitions points on the BBS of another protagonist is ali Zhang Hongping capital managing director.

“BAT clan” (baidu, alibaba, tencent), but failed to tencent principals to be present. In the words of Zhang Hongping, “whether it’s the love triangle or three kingdoms, along with more and more investment in mergers and acquisitions, we bumped into three companies often.”

I record and combed the soup and loose at the scene and Zhang Hongping dialogue few fragments, hope can help a glimpse into the Internet leading investment ideas.


soup and pine: first to explain is that baidu all investments are tightly around the “strategic” two characters. We don’t chase financial investment, and requirements on strategy with baidu have significant meaning.

how to understand strategy? The metaphysical terms, strategic points in three aspects:

the first, to strengthen core business. Baidu’s core business is search, then around the search technology, product and team, is our main aim of investment.

the second, the establishment of the ecological system. Baidu think ecosystem is a personal, websites, and Internet users, to help promote their symbiotic, development and prosperity.

the third, the layout in the future. We have always said that the mobile Internet is the future, but now it is not the “future”, the mobile Internet is “today”. So now for some non-core, but judgment down likely to be “the future” business, layout in advance.

Zhang Hongping: ali’s investment ideas can be divided into two parts:

it is integrated with strong ability of ali. As long as is good for ali itself, holding, acquisition, account for how much, can be discussed. In this, we will do some influential investment.

2 is related to the ecosystem, platform alibaba company, emphasizing the layout and symbiotic relationship. For example, we cast the stranger stranger, beauty group, tintin, on the road, ali to take minority stakes.

investment direction, the wireless Internet is still the focus of the future. Taobao, Tmall is based on a physical trading platform, but if you look at, along with the economy growing, the nonphysical part of proportion of economic increasing, so we are also looking at some new areas, such as local living services, cultural industries, etc.

how to choose?

soup and loose: the success of one thing, need a lot of necessary conditions to constitute a sufficient (conditions). Can have so many conditions, which is what is sesame watermelon?

assessment of a target company, baidu in short two levels:

the first is the strategic level. Be sure to rigorous, accurate, deeply understand the relationship between it and baidu. Maybe he couldn’t understand clearly, maybe there are some things can only be wise after the event, but you have to try our best. Ask yourself the following questions – what we need is? What is your need? Both sides of the positioning is what? Go back together, what relationship?

error in strategic and tactical is not to be able to save a person’s character is not good, in the end will be failure, is the same reason.

the second is the tactical level. This layer pay attention to many details conditions, but in the final analysis is the embodiment of the strategic requirements of tactical. Such as watching a team, have to consider their quality, sustainability and cooperative attitude, and so on. And such as a company in the emerging industry, it has a huge user base, the establishment of a higher barriers, but you have to think again, it is the leading in the market of early, mid, or late? And so on.

Zhang Hongping: investment is actually in the future, not now existing or very strong, but and we have a complementary, or the place where we need to grow in the future.

alibaba to find the object is divided into two categories:

a, TP (Taobao Patrner), namely the Taobao partner. For example, we cast beauty and treasure statue of electricity, they can be classified as TP. Growth is good in itself, both firms have financial value, and the like ali do some basic work in the field of electronic commerce, meet the daily needs, they are meaningful to perfect ali platform.

2, ali also love the investment has unique advantages in wireless, users and industry status of the company, like gold, sina weibo, Momo, tintin, Meituan, etc. When the future pattern of change, such as traditional PC (personal computer) more to wireless Internet, these companies may be able to with ali to produce value.

how to value?

soup and pine: I want to say, from the philosophical level to clinch a deal the price a little understanding.

the price of a thing, forever is decided by two factors: first, it is independent on the market is worth? Second, a specific person, willing to offer for it? So the price of a target company, always start from the market price, with the value of strategic caps.

is like a bottle of mineral water, to a thirsty person and a person, not thirsty now meaning is different, is willing to pay the price is different also.

for example, a building near Beijing wudaokou particularly expensive, because it has the resources, the so-called “school district room”, it is said that the similar one square metre. If a set of housing price is now about 19 million, you buy it?

my answer is as follows: if the rich dad itself is worth 5 billion yuan, children have the house and work hard, admitted to the Peking University tsinghua university, after graduation can inherit and do a good 5 billion family industry, produce good fluctuations in the marginal benefit, has strategic significance, can buy.

if torre is a civilian, even if he purchased the school district room, children later admitted to Peking University tsinghua university. Can inherit the only dad’s genes, he went into the bank after graduation work, with more than 10000 yuan a month salary is good, it won’t be able to buy the house.

Zhang Hongping: do investment are very clear valuation methods and models, according to the existing of the listed company of PE (p/e), PS (price-to-sales ratio), the company’s future possible profit discount in etc, for reference. But the above is the academic theories, models and theories provide investment based on the actual combat, but the real combat on incomplete.

it is said that the company is only worth $10, you spend 100 yuan to buy, silly not silly? But if the merger and acquisition, it can generate an income of 1000 yuan, that’s not stupid, is worth doing.

so, factors influencing the value of a target company has two: one is the target how much is the strategic demand; Second, the dynamic relationship of supply and demand on the market, the demand or supply exceeds demand, the target company will affect the purchase price.